49ers score $138 million in recently sold luxury boxes for Santa Clara stadium

After a rocky year trying to raise money to build a nearly $1 billion stadium in Santa Clara, the 49ers have scored their biggest victory to date: $138 million in recently sold luxury boxes.

The sale is a sorely needed touchdown for the local football franchise, already dealing with a yearlong delay to its stadium construction, the NFL lockout and the pending death of redevelopment agencies, which jeopardizes its funding plan.

But with scores of fans and companies gobbling up perhaps the most valuable commodity the stadium has to offer - 165 opulent suites, up from 77 at the team's current home, Candlestick Park - team and city officials hope to prove they're right on track.

"These remarkable sale results should answer anyone who asks if the stadium in Santa Clara will be a reality," Mayor Jamie Matthews said Thursday.

The money more than doubles the total funding committed so far and puts the team and city about one-fourth of the way toward bankrolling the $987 million project next to Great America, with construction expected to start in January 2013.

In disclosing fundraising figures for the first time, 49ers Chief Operating Officer Paraag Marathe said it was the "first time we're able to demonstrate to the fans that this is real.

"It validates the confidence we've had in the project all along," Marathe said, "and it shows the tremendous amount of support and confidence that our fans have for this project. One hundred and thirty-eight million is no small number; it lays a pretty big foundation."

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Team officials said the buyers have not given permission to disclose their names yet, but a majority of suite owners so far are individuals, along with some companies. Marathe would not say how much the suites cost or how many have sold, but he noted there are still boxes available. That would leave the average buyer paying close to or even more than $1 million.
Marathe also said that most buyers had bought in for "long-term commitments" instead of signing on for just the opening season, set for 2015, putting the average annual price in the high tens of thousands or even hundreds of thousands of dollars.

A couple of months after Santa Clara voters approved the project in June 2010, team officials hooked up with Legends Hospitality - the same firm that helped sell suites in the new Cowboys Stadium and worked on the new Yankee Stadium - to sell luxury boxes for the Santa Clara stadium. Its sales team has opened a visitors center near the team's Santa Clara headquarters, complete with a stadium model replica.

Luxury boxes are typically the priciest way to attend an NFL game. They allow groups of fans or companies to rent or buy a room overlooking the field, between the lower bowl and upper deck, with their own TVs, living room-style chairs, food service and parking passes. At the 49ers stadium, suites will come with Internet access and even the occasional road game trip for high rollers.

Many sports owners, especially in pro football, have built new stadiums with more luxury boxes, which don't necessarily add much to the swirling noise that gives teams a home-field advantage but keep huge chunks of revenue pumping into the franchise.

The financing plan to build the 68,500-seat stadium has long included the team's responsibility to raise large revenues from selling luxury boxes, although it has been unclear how much. Matthews said the results so far have exceeded his expectations.

The suite revenue adds to the city's commitment to spend $78 million and local hotels' responsibility to raise $35 million through room-fee hikes.

The league and team are responsible for making up much of the difference in the next few years, as is the city by selling naming rights, concessions contracts and other deals.

But the cost of the stadium has recently jumped $50 million as the ongoing NFL lockout delayed the project a year and put any league funding on hold. Most of the city's $40 million redevelopment contribution is also now in question because of the state's plan to scrap all of California's redevelopment agencies. Critics doubt the full funding plan will materialize on time, if ever.
The City Council and public are scheduled to receive a presentation on the suite sales at a busy Tuesday night meeting.

Also at the meeting, the council is scheduled to give the 49ers permission for more detailed design studies and will enter an agreement with Volume Services to obtain input on designing the concessions and merchandise areas of the stadium.

The council is also set to approve a contract with New Jersey-based Legends to sell stadium builders licenses and another deal with the 49ers to market the licenses. Finally, the council is set to approve a $400,000 economic consulting contract with Keyser Marston Associates of San Francisco to negotiate stadium financing and development deals with the 49ers.